Trade minister calls for easing 52-hour workweek rule, breaking with labor minister

Cabinet ministers are sharply divided over a proposed exemption from the 52-hour workweek limit — one of the most contentious provisions in the government's draft legislation for mega special economic zones.

Minister of Trade, Industry and Energy Kim Jung-kwan said Thursday at a Kwanhun Club forum at the Press Center in Seoul that the law should not "forcibly block the will of young people who want to work," calling for an exemption from the 52-hour rule inside the planned mega special zones.

Kim said the 52-hour debate must be viewed against the backdrop of China, South Korea's fiercest competitor, and recalled an anecdote from a business trip there during his time in the private sector.

He said he was stunned to hear from an official at an IT company in Chongqing that when the firm tried to introduce the "996" system — 9 a.m. to 9 p.m., six days a week — employees pushed back, asking how the company could compete with rivals under such conditions. The firm ultimately shifted to a system requiring staff to work until midnight.

"Competition inside China is truly fierce," Kim said. "Chinese workers worry when companies try to cut hours because they know the company has to grow for them to get paid."

He said the system should not "dampen the drive and determination of people who want to work hard and achieve," and called for a broad overhaul of working-hour rules across research and development, startups and advanced industries.

The remarks put Kim at odds with Minister of Employment and Labor Kim Young-hoon.

At a briefing with reporters on Wednesday, Kim Young-hoon noted that South Korea's major chipmakers already operate under the 52-hour regime and said they are "generating enormous profits even without an exemption."

He added: "It's not as if we've been overtaken across the board. The debate has become so overheated — as though an exemption is absolutely indispensable — that it's making a healthy discussion difficult."

Kim Young-hoon said the gap between labor and management cannot be eliminated entirely, but that a reasonable alternative grounded in the facts can be found. He said the two major umbrella labor federations had proposed a presidential meeting and social dialogue on the issue, and that he would proceed by communicating fully with labor.

Kim Jung-kwan also said he expects the results of a US Section 301 investigation into overproduction to be released by the end of this month, and disclosed that trade authorities on both sides have reached a consensus around a 15 percent tariff ceiling.

Concern has been growing that the final tariff rate could exceed the 15 percent cap set under last year's bilateral trade agreement, given that the United States has already imposed a 12.5 percent forced-labor tariff on South Korea and the Section 301 overproduction findings have yet to be added.

"We are doing our utmost to ensure that the Section 301 tariffs — including the remaining overproduction-related components — stay within the 15 percent ceiling agreed with the United States," Kim Jung-kwan said. "There is a degree of consensus on that point between our trade authorities."

He added, however, that 15 percent is not the ultimate goal. "The goal is a level that is not disadvantageous relative to competing countries. The United States set 15 percent by comparing us with competitors, so please understand that the target for the bilateral tariff level is a rate that is not unfavorable compared to those competitors."

The US Supreme Court ruled in February that the reciprocal tariffs imposed by the Donald Trump administration were unlawful.

The Trump administration subsequently imposed a temporary 10 percent global tariff on all countries under Section 122 of the Trade Act, but that measure expired last month when its statutory 150-day limit was reached.

The Office of the United States Trade Representative then applied Section 301 of the Trade Act starting July 24, targeting imports allegedly produced with forced labor, and levied new "forced-labor tariffs" of 10 to 12.5 percent on major trading partners. South Korea was hit with a 12.5 percent rate.

Kim Jung-kwan also addressed the Coupang Inc controversy, which has emerged as a flashpoint in the bilateral relationship, saying perceptions differ "somewhat depending on who you talk to in the United States."

"When I meet American politicians, I get the impression they react very sensitively to Coupang," he said. "By contrast, the trade officials I meet at the Commerce Department and USTR have a much better understanding of the substance of the Coupang case."

He noted that some in US political circles have mistakenly viewed Coupang as a vehicle for reducing the bilateral trade deficit.

"Many American politicians believe that Coupang is responsible for importing US agricultural, fishery and livestock products into Korea," Kim said. "When I tell them that most Koreans understand Coupang as importing cheap Chinese goods from nearby — not American products — they are genuinely surprised."

He said the core of the Coupang issue is that personal data on nearly 80 percent of Korean adults was leaked and went undetected for months. "When I ask American politicians how the United States would treat a foreign company that failed to properly report or follow legal procedures after the data of 80 percent of American adults was leaked abroad, most of them come around," he said.

Kim drew a line against framing the matter as a bilateral dispute, saying Coupang could not have grown so rapidly if the Korean government had discriminated against it as a US company. "The Coupang issue is not at a level that could shake the foundation of the Korea-US alliance," he said.